03/08/2026
๐ง๐๐ผ ๐ฑ๐ถ๐ฎ๐น๐, ๐ฝ๐ผ๐ถ๐ป๐๐ถ๐ป๐ด ๐ถ๐ป ๐ฑ๐ถ๐ณ๐ณ๐ฒ๐ฟ๐ฒ๐ป๐ ๐ฑ๐ถ๐ฟ๐ฒ๐ฐ๐๐ถ๐ผ๐ป๐
In our last update, markets had shifted from expecting two rate cuts this year to expecting a hold. Three members of the Bank of England's rate-setting committee have now gone a step further. On 30 July they voted to raise the base rate to 4%. They were outvoted six to three, so the Bank Rate stays at 3.75%, but a third of the committee wanting rates higher is worth noticing.
That sits oddly against the inflation numbers, which are genuinely good. CPI fell to 2.6% in the year to June, down from 2.8%, and the lowest reading since March 2025. Cheaper fuel at the pumps did most of the work. Both things are true because they measure different things. Inflation tells you where we have been. The committee is looking at where the Middle East energy shock takes us over the next twelve months.
For mortgage pricing, the second dial is the one that counts. Fixed rates follow swap rates rather than the base rate. A swap is simply what it costs a lender to borrow money at a fixed price for a set number of years, which means swaps move on what the market expects rates to do next, not on what they are today.
Swap rates fell in the first couple of months of the year, then shot up on the back of Middle-Eastern tensions at the beginning of March, then we had a ceasefire โ and that is what gave us a limited run of fixed rate reductions. Since then, the picture has taken a turn for the worse again, with Oil Prices going back up and uncertainty back on the table, Swap Rates and Mortgage Rates have been back on the rise again.
Where they go from here depends largely on oil. If tensions ease, swaps should settle and competition between lenders picks up again. If they do not, expect continued upward pressure on fixed pricing. Both are genuinely possible.
The encouraging part is that appetite has not gone anywhere. Product choice rose for a third straight month to over 7,100 deals, and with average standard variable rates at 7.13%, the gap between a fixed deal and a revert rate remains wide. Lenders want to lend. Next decision is 17 September.
๐ ๐ป๐ฒ๐ ๐ฃ๐ฟ๐ถ๐บ๐ฒ ๐ ๐ถ๐ป๐ถ๐๐๐ฒ๐ฟ, ๐ฎ๐ป๐ฑ ๐๐ต๐ฎ๐ ๐ต๐ฒ ๐ต๐ฎ๐ ๐ฟ๐๐น๐ฒ๐ฑ ๐ผ๐๐
Andy Burnham took office on 20 July. The useful question is not what he might eventually do, but what is now off the table.
Two things are, and both matter to us. Stamp duty will not change at the Autumn Budget, confirmed directly in response to weekend reports suggesting otherwise. And rent controls have been ruled out for England, with Angela Rayner returning as Housing Secretary.
Ruling things out has real value. Last autumn, months of speculation about stamp duty and capital gains reform did measurable damage to activity while everyone waited for an answer. Closing those questions down early takes a source of hesitation out of the market.
Also confirmed: VAT on domestic electricity drops from 5% to zero for six months from 1 October, worth around ยฃ45 a year to a typical household.
Still open: longer-term property tax reform remains an idea rather than a policy, with no timetable or legislation attached. Two changes are already on the statute book though, and worth diarising โ the tax rate on property income rises in April 2027, and a surcharge on homes valued over ยฃ2 million starts in April 2028. Neither is new, and neither came from the current administration.
๐ ๐พ๐๐ถ๐ฒ๐ ๐บ๐ผ๐ป๐๐ต, ๐ฎ๐ป๐ฑ ๐๐ต๐ฒ ๐ป๐๐บ๐ฏ๐ฒ๐ฟ ๐ฒ๐๐ฒ๐ฟ๐ ๐๐ฒ๐น๐น๐ฒ๐ฟ ๐๐ต๐ผ๐๐น๐ฑ ๐๐ฒ๐ฒ
Nationwide put annual house price growth at 1.8% in July, down from 2.2%, with the average property at ยฃ277,542. Rightmove, which tracks asking prices rather than sale prices, recorded a 1% fall to ยฃ372,359. That is a bigger drop than the 0.2% that is normal for July.
Given the month it was, none of that is surprising. Supply is close to a twelve-year high, so buyers have plenty to look at. Sales agreed across the first half were 6% down on last year but level with 2024, and mortgage approvals ticked up in June. Slower, not stalling.
Of all homes sold so far this year, 74% never needed a price reduction. The quarter that did, spent an average of 127 days on the market. The ones priced right from day one sold in 36.
That is three months of difference, entirely within the seller's control at the point of instruction. With this much choice around, an ambitious price does not sell slowly for more. It usually makes the house next door look like the obvious buy, then sells later for less than it would have achieved at the start. And since roughly four in five sellers are also buyers, the number that really matters is the gap between selling and buying, not the headline on the board.
๐ง๐ต๐ฒ ๐ด๐ผ๐ผ๐ฑ ๐ป๐ฒ๐๐: ๐๐ต๐ฒ ๐ฑ๐ผ๐ผ๐ฟ ๐ถ๐ ๐ผ๐ฝ๐ฒ๐ป๐ถ๐ป๐ด ๐๐ถ๐ฑ๐ฒ๐ฟ
On 28 July the FCA's consultation on mortgage access closed. It is the most significant piece of work on this in over a decade, and it is aimed squarely at the people the current rules keep out. The self-employed. Contractors. Anyone whose income does not arrive in twelve equal instalments. Older borrowers. People who had a rough few years and have since put things right.
Responsible lending requirements stay in place. What changes is the recognition that "affordable" has been measured in a way that suits some people's finances rather better than others.
The regulator's evidence for why it can afford to do this is striking: around 99% of mortgages taken out since 2014 are not in arrears. That is through a pandemic, an inflation shock and the sharpest rate rises in a generation. The market built something genuinely resilient, and that resilience is now buying room to widen access. Final rules are expected in the second half of this year.
๐๐ผ๐ ๐ฎ๐ป๐ ๐บ๐ผ๐ฟ๐๐ด๐ฎ๐ด๐ฒ ๐พ๐๐ฒ๐๐๐ถ๐ผ๐ป๐? ๐๐ฒ๐ ๐ถ๐ป ๐๐ผ๐๐ฐ๐ต! ๐ก
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